Pound Australian Dollar (GBP/AUD) Exchange Rate Dips as Australian Consumer Confidence Hits 11-Year High

GBP/AUD Exchange Rate Falls as Australian Consumer Confidence Beats Forecasts

The Pound Australian Dollar exchange rate dipped today following the release of April’s Australian Westpac Consumer Confidence figure, which rose from 2.6% to 6.2%. The pairing is currently fluctuating around AU$1.79.

The Australian Dollar (AUD) has benefited from the 11-year high consumer confidence figure. AUD traders now becoming more hopeful about the outlook for Australia’s economy.

Bill Evans, Westpac’s chief economist, described the result as being ‘extraordinary’ in the context of Covid-19.

Evans added:

‘The survey continues to signal that the consumer will be the key driver of above-trend growth in 2021.

‘The survey was conducted in the week following the unwinding of the JobKeeper program. Initial fears that this and associated job losses would undermine confidence have proven to be unfounded.’

Australia’s relatively slow Covid-19 vaccine rollout programme has, however, left some Australian Dollar investors feeling cautious the economy.

Pound (GBP) Falls Despite Strong UK GDP Data for February

The Pound (GBP) failed to rise against the ‘Aussie’ today despite the recent easing of Covid-19 lockdown restrictions. Non-essential shops, pubs and restaurants have been able to reopen for outdoor customers.

Yesterday saw data that revealed that the UK had returned to growth in February despite Covid-19 restrictions. Businesses adapted to the lockdown and EU exports showed a partial recovery.

Suren Thiru, the head of economics at the British Chambers of Commerce, was more cautious, however, commenting:

‘[H]ope of a sustained consumer-led revival may prove too optimistic as the economic scarring caused by Covid may trigger a renewed reluctance to spend as government support winds down.’

Rory Macqueen, the principal economist at the National Institute of Economic and Social Research, was more confident about the outlook for Britain’s economy, saying:

‘If the vaccine programme and lifting of restrictions continue on schedule this provides a firm basis for continuing growth in the second quarter and 2021 overall.’

However, with a lack of UK economic data today, GBP investors are instead eyeing the nation’s Covid-19 station.

It is still relatively uncertain what direction coronavirus cases could take, despite the mass vaccination programme, as Europe’s cases continue to spike.

Pound Australian Dollar Exchange Rate Forecast: Could Rising Australian Unemployment Weaken the ‘Aussie’?

Australian Dollar (AUD) traders will be eyeing tomorrow’s release of the latest Australian Unemployment Rate figure.

Any signs of rising unemployment in Australia would drag down the Australian Dollar Pound exchange rate.

Tomorrow will also see the release of March’s Australian Employment Change figure. If this indicates a labour crisis in Australia the ‘Aussie’ would suffer.

The Pound Australian Doller exchange rate could head higher, however, if the UK’s economic outlook continues to improve as the nation cautiously reopens its high streets.  

David Moore

Contact David Moore